New Delhi, Nov 24: Maruti Suzuki India on Friday said its board has approved allotment of over 1.23 crore shares to its parent Suzuki Motor Corporation (SMC) on a preferential basis for the acquisition of 100 per cent stake in Suzuki Motor Gujarat.
The company’s board has approved allotment of 1,23,22,514 shares to SMC having face value of Rs 5 each at a price of Rs 10,420.85 per share, the auto major said in a regulatory filing.
As per the valuation report issued by RBSA Valuation Advisors LLP, the Rs 10,420.85 price per share approved by Maruti Suzuki board is equivalent to Rs 12,841.1 crore in value terms.
With the allotment, SMC’s stake in Maruti Suzuki India (MSI) will increase to 58.19 per cent from the earlier 56.48 per cent.
Last week, Maruti Suzuki shareholders had approved a proposal to issue shares on a preferential basis to SMC as consideration for a related party transaction for the acquisition of 100 per cent stake in Suzuki Motor Gujarat (SMG).
The MSI board, in its meeting held on July 31, 2023, had approved the termination of the contract manufacturing agreement with SMG and the acquisition of its shares by SMC at a price to be determined in accordance with all applicable laws and regulations.
MSI Chairman R C Bhargava had said that the share-swap method adopted for the acquisition of SMG is far better for the shareholders of the company. He had reiterated that the aim of the acquisition was to align the production operations under a single management, taking into consideration the company’s future growth prospects when it envisages to have a total production of 40 lakh units annually by 2030-31.
Since 2014, SMC has invested Rs 18,000 crore in SMG. A fully-owned subsidiary of SMC, SMG supplies its entire production exclusively to MSI. SMG, which was incorporated in 2014, has a production facility in Gujarat with an installed capacity of 7.5 lakh units per annum.
(PTI)
Follow our WhatsApp channel
